With rising global temperatures, devastating wildfires, and other increasingly costly weather-related blows to our environment, we stand at a critical juncture in time. But the call for climate action isn’t just an individual urgency; it’s a business imperative. Corporations, collectively, have a responsibility to take concrete action – to maximize our long-term potential to grow and thrive.
Weaving sustainability into business DNA
The Estée Lauder Companies (ELC) is a 77-year-old organization that employs approximately 62,000 people in over 50 countries and its products are sold in approximately 150 countries and territories. In my role as VP of Sustainability, I have seen firsthand the power of integrating sustainability into our operations, and I believe such integration is critical for the achievement of our climate goals.
We remain committed to transforming our business to incorporate sustainability across our value chain from our corporate headquarters to our retail stores. This work ranges from the products we sell and how we work with suppliers, to how we operate manufacturing facilities around the world. As part of our green chemistry philosophy, we developed a proprietary methodology to enable our product formulators to make informed ingredient and formulation choices through the lenses of human health, ecosystem health, and environmental health. In short, our dedication to sustainability isn’t an add-on; it’s something we aim to weave into the fabric of our business.
The brands in our well-diversified portfolio have embraced our commitment to social impact and sustainability, and we encourage them to develop their own unique strategies as relevant to their consumers and brand promises. For example, we have partnered with a leading packaging provider to develop the first-ever paper-based, recyclable beauty sample sachet for our Aveda brand, which is using it in the EU and the UK as a pilot, rolling out in fiscal year 2025.
Championing a sustainable future for the beauty industry and beyond
As a member of both the beauty industry and broader business community, our ambition as a business has always been to push boundaries and delight consumers with the unexpected. It’s ingrained in the founding values of our company and has evolved to include the establishment of public sustainability goals. That’s why we’re leveraging our global platform and partnerships in an effort to contribute to the transition to a low-carbon economy, investing in green energy solutions that will ultimately help protect the health of our planet and our people.
Starting with our fiscal year ending on June 30, 2020, and in each fiscal year since, we have sourced 100% renewable electricity globally for our direct operations – an achievement we intend to maintain moving forward. We initially set that goal in 2017 as one of the few beauty companies in the Climate Group’s RE100 initiative, a global group bringing together hundreds of large businesses committed to 100% renewable electricity.
We also helped lead our industry as the first beauty company to join the EV100 initiative, which brought together companies committed to accelerating the transition to electric vehicles. With our current corporate fleet of vehicles comprising about 35% of our Scope 1 emissions, we announced in the past year a new goal to transition our corporate fleet to 100% electric by 2030.
Sourcing renewable energy is a key part of our strategy. A few years ago, we became the first prestige beauty company to execute a Virtual Power Purchase Agreement (VPPA) for wind power. Our VPPA relates to the Ponderosa wind farm in Oklahoma; and it remains the largest renewable energy initiative in our portfolio, generating enough electricity to cover more than half of our global electricity footprint. Our newest Canadian facility, in Markham, Ontario, is powered, in part, by solar power generated on-site. That facility, in line with our integrated sustainability strategy, was built using green building practices such as windows fitted with glass that prevents injury to birds, green parking spaces for hybrid and electric vehicles, and water efficiency measures that save the equivalent of three Olympic size swimming pools’ worth of potable water each year.
Harnessing the power of collaboration
We recognize the power of collective impact and seek opportunities to join forces with like-minded organizations to help advance our sustainability initiatives. Our participation in climate coalitions, such as the U.S. Department of Energy’s Better Plants program and the Science Based Targets initiative, is part of our expansive solar power strategy which includes some of our largest projects in Switzerland, New York, the UK and elsewhere. In 2022, we generated more than 5,661 megawatt-hours of solar energy, equivalent to what’s needed to power the average American home for 566 years.
We’re also leveraging collaboration to improve sustainability in supply chains beyond our own. We partnered with the Climate Group to host a discussion at COP26, convening leaders from across industries that explored how to scale climate solutions to address global supply chain footprints to reduce Scope 3 emissions. Last year, we were the first beauty company to join Supplier Leadership on Climate Transition (Supplier LoCT), a consortium created to accelerate action throughout the supply chain towards achieving Net Zero GHG emissions. The consortium provides an online climate training program to suppliers to support them in their journey of developing a GHG footprint, setting an SBT, adopting GHG-abatement measures, and disclosing progress. We invited more than 40 of our suppliers to this program in fiscal 2022.
Additionally, ELC is a founding member of Zero100, an initiative that connects and inspires a new generation of leaders to invent 0% carbon supply chains that are 100% digital. Joining forces with other companies in this way helps us scale and accelerate technologies that can help make supply chains more agile and better for the environment. For ELC, this investment has the potential to help build sustainability into the journey our products take from inception to consumers’ homes.
We’re cognizant that companies are at different stages of the journey toward sustainability, with some just beginning and others having reached key milestones. What’s important is that businesses do something every day to help drive climate action and work together to set a course for a sustainable legacy for future generations. I believe that embedding sustainability and working collaboratively can help speed the process. After all, there’s no time to waste.